What: All Issues :
Fair Taxation :
More Equitable Distribution of Tax Burden :
(H.R. 4213) On legislation extending the tuition tax deduction, the R&D tax credit and several other tax reductions through the 2010 fiscal year - - on a motion to table (kill) the appeal of a ruling by the Speaker; the ruling was that a motion to add language reducing a proposed tax increase on certain interest generated by businesses was not in order

Who:
All Members

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(H.R. 4213) On legislation extending the tuition tax deduction, the R&D tax credit and several other tax reductions through the 2010 fiscal year - - on a motion to table (kill) the appeal of a ruling by the Speaker; the ruling was that a motion to add language reducing a proposed tax increase on certain interest generated by businesses was not in order

This was a vote on motion to table (kill) the appeal of a ruling by the Speaker. The ruling that had been appealed was that a motion made by Rep. Camp (R-MI), to eliminate language in a pending bill that increased a tax on certain interest generated by businesses, was not in order. The motion had been ruled out of order because it violated the House rule that all proposed revenue reductions, which the Camp motion was, had to be compensated for with spending reductions or other revenue increases. No such revenue increase or spending reduction was included in the motion by Rep. Camp.

The interest on which Rep. Camp was trying to have a proposed tax increase rolled back was called “carried interest”. It is the interest paid to the manager of a hedge fund or HYPERLINK "http://en.wikipedia.org/wiki/Private_equity_fund" \o "Private equity fund" private equity fund as the share of the profits of the fund.

Rep. Camp argued that the ruling that his motion was out of order should be reversed both because of the substance of his motion and because of the way the House had previously operated. On the grounds of substance, Camp argued that not permitting him to offer his motion would prevent “the House from considering the merits of a different approach to the underlying bill, one that would let the American people keep more of their hard-earned income . . . (I)t would prevent the House from considering whether to extend (the current tax rate on carried interest) . . .We should be encouraging business investment, not discouraging it through higher taxes . . . (T)his carried interest tax . . . changes how business income has been taxed for decades, making income currently taxed at 15 percent up to 35 percent, more than doubling it . . . .”

On the ground on procedure, Camp argued that “granting this point of order would foreclose the House from even considering whether it might want to pass this bill with . . . further tax relief.” He claimed that allowing motions such as his that are not formally compliant with the House rule that revenue offsets must be identified is “something that all minorities, Republican and Democrat, over the last many years have been permitted . . . including as recently as last year.”

The motion to kill the appeal of the ruling passed by a vote of 251-172 along almost straight party lines. Two hundred and fifty-Democrats and one Republican voted “aye”. One hundred and seventy-one Republicans and one Democrat voted “nay”. As a result, the motion that would have eliminated a change in pending legislation that increased a tax on carried interest could not be offered.